Buyer’s Market Vs. Seller’s Market: What’s the Difference?
If you have studied the property market, you should know that the scales usually tip in favor of either buyers or sellers — and understanding the difference between the two is important to get the best bang for your buck, irrespective of which side of the fence you’re on.
Here’s our guide to the buyer’s vs. seller’s market:
The power position is arguably the biggest difference between a buyer’s market and a seller’s market. Since buyers’ markets are more favorable to buyers (lower prices, more inventory), they have more power than sellers. In contrast, seller’s markets give the power to sellers, letting them ask more for their homes while encouraging bidding wars.
Buyers always have some expectations. In a buyer’s market, potential buyers expect to find a lot of inventory and an attractive deal. However, in a seller’s market, they have to compete with other buyers and usually pay top dollar. But they also look forward to getting a turnkey property for their investment. Since buyers know they’re paying a premium in a seller’s market, they want their purchase to reflect that. In turn, sellers have to offer a home worthy of an asking price of a seller’s market. While an as-is property will sell in an in-demand market, ROI can be exponentially better when a home is properly cared for. In a seller’s market, homes that are priced slightly below market rate, are expertly represented, and are staged beautifully are the ones that get dozens of offers in a matter of days.
Marketing a home in a buyer’s market differs from marketing a home in a seller’s market. In markets that favor buyers, realtors and homeowners must be aggressive about making a house stand out by holding open houses, placing traditional ads, and using social media. When it comes to marketing, a seller’s market offer sellers a little more leeway. However, many homeowners make the mistake of neglecting to market in a hot environment. Even in a seller’s market, sellers must present their homes in the best light to buyers using professional photos, proper pricing, and professional staging.
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